SC seeks reply from PW on Sebi’s plea in Satyam case

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SummaryThe Supreme Court on Tuesday sought reply from audit firm Price Waterhouse on Sebi's plea seeking stay on the sectoral tribunal's order that allowed the firm to cross-examine accused indicted in the R7,000-crore Satyam Computer Services scam, including the company's founder B Ramalinga Raju.

The Supreme Court on Tuesday sought reply from audit firm Price Waterhouse on Sebi's plea seeking stay on the sectoral tribunal's order that allowed the firm to cross-examine accused indicted in the R7,000-crore Satyam Computer Services scam, including the company's founder B Ramalinga Raju.

A bench headed by Justice SS Nijjar issued notice to the audit firm and also posted the matter for final hearing in October.

The appeal has challenged the Securities Appellate Tribunal's order of June last year asking Sebi to allow Price Waterhouse, the scam tained company's external auditor, to cross-examine Raju, his brother and managing director B Rama Raju, and former CFO Vadlamani Srinivas. SAT had also asked Sebi to furnish copies of their statements to Price Waterhouse, the Indian arm of global professional services firm PriceWaterhouseCoopers, if necessary.

Sebi had relied on the statements of Raju and the other accused to issue show-cause notices to Price Waterhouse asking them why they should not be debarred from carrying out auditing work for listed companies for a particular period.

It had alleged that the audit firm had not properly audited the financial statements of Satyam and the financial statements presented did not provide a fair and accurate financial position of Satyam, which Raju has admitted were manipulated and false.

Price Waterhouse had moved the SAT as Sebi had rejected its request to allow access to documents and to those accused in the fraud case, which rattled India Inc in 2009.

Price Waterhouse was the auditor of Satyam from April 2000 to September 2008. S Gopalakrishnan, a partner in the firm, had certified the audit reports for the period April 2000 to March 2007, and Srinivas Talluri, another partner in the firm, had certified the audit report for the period April 2007 to September 2008.

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